Yelp.com Can Hurt Your Business

Why does this make me uncomfortable? Yelp, part of a giant advertising machine, is fighting for online Freedom of Speech by whooping-up on a small business owner in Virginia State Supreme Court. Sounds like another incident of online bullying that ends badly. Except this time, the effects might be game-changing because Yelp is a bully with lots of money.

Yelp gets at least 5 subpoenas monthly from business owners seeking the names of anonymous users who have unfairly attacked their businesses online. Unfortunately for these owners, very few lawsuits are ever successful. This is because Yelp and other websites like them (CitySearch, Angie’s List, Google + Local, Yahoo Local, and Amazon.com) are protected from liability for defamation claims under the Communications Decency Act of 1996. Complaints—whether true or false– can cost your company thousands of dollars in lost business.

In November of 2013 Yelp hired lobbyist Laurent Crenshaw to push for a federal “Anti-SLAPP” law, which will, if enacted, make it even tougher for small business owners to protect themselves in the Courts against anonymous critics. Mr. Crenshaw used to work for U.S. Representative Darrell Issa, who now sits the House Committee On Judiciary Subcommittee on Courts, Intellectual Property, and the Internet. Crenshaw has been working hard in his new capacity, according to his LD-2 Disclosure form filed with the U.S. House of Representatives, in two months his expenses were $30,000 lobbying for Yelp. See his expenditure report . His specific lobbying issues are listed as: “Working to promote competition in the online marketplace. Protecting and promoting Internet freedom.” And, “Working to promote commercial freedom of speech issues, particularly as it relates to allowing users to freely share their opinions online.”

Yelp is serious about protecting the anonymity of its reviewers. In at least one case, they’ve protected some reviewers all the way to the Virginia Supreme Court. The owner of a local carpet cleaning business, Joe Hadeed, sued to find out who had launched a campaign of complaints against his business. Mr. Hadeed claims business plummeted 30% as negative reviews replaced his positive ones. He says details in the reviews didn’t match up with any customers, or job dates, and many of the complaints had similar themes such as claiming his company had doubled its quoted price. One of the reviewers was from an area where Hadeed does not do business. Details of the case are available on The Digital Media Law Project website.

Why Won’t Yelp Change its Policies?

It’s naive to think Yelp is really interested in protecting consumer rights to free speech. The elephant in the room is their profit motive. Internet advertising is huge. According to Yelp’s website FAQs , they had as many as 120 million monthly unique visitors in the fourth quarter of 2013, and “yelpers” have written over 53 million local reviews. That’s a lot of reach: a lot of dollars.

Should Yelp be concerned about the veracity of reviews?

From a dollar & cents perspective, maybe not, because the easier it is for people to post reviews on their website, the more people see their advertising. But what about from the viewpoint of fairness or truthfulness? I think they should care for two reasons:

If consumers don’t believe reviews are written by real customers, they’ll stop paying attention to them.

Yelp might be shooting itself in the foot in its legislative & legal fight for unrestrained “online Freedom.” Considering their obvious self-interest in the matter, they risk being branded Big Business Bullies by public opinion.

My Advice to Yelp

Require “yelpers” to use their real names for reviews.

Fairly respond to and investigate complaints by business owners.

Delete fishy reviews when there’s doubt about their truthfulness.

Give all reviews a shelf life of 2-years.

Potential for Further Harm

Competitors have been known to leave damning reviews about their rivals on Yelp, and there’s nothing you can do about it if these websites refuse your request to remove a review. And, Yelp itself has been accused of posting negative reviews about companies who refuse to buy advertising. Since 2008, the Federal Trade Commission has received over 2,000 complaints from small business owners, some claiming to have received fraudulent or unfair reviews after turning down Yelp’s pitch to buy advertising. Read this letter about Yelp on the FTC website.

This article is part of a continuing series titled STL Web Matters, which is a free online publication. It explores useful web tools & technologies for Saint Louis small-business owners. Browse more articles through my website STLontheWeb.net Anyone wishing to be a guest blogger, please see Editorial Perspective before offering content. I very much would like to know what you think about this article, so please leave a comment below. You’ll be asked for your email address, but don’t worry I won’t share it with anyone or send you spam:-).